Lee County manager's severance may violate law

Oct. 24, 2012

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The more than $250,000 payday Lee County’s manager received for resigning in the aftermath of Medstar may violate state law, according to attorney general opinions and senate analysis.

Meanwhile, Commissioner Tammy Hall moved to rescind the severance package she took part in approving for County Manager Karen Hawes, according to a Wednesday email from Hall.

Deputy County Attorney Andrea Fraser deceived Hall into thinking that the county manager was entitled to the payout under the terms of her 2009 employment contract, according to the email Hall sent to Fraser.

“After discovering today that we are including more than is required in the County Manager Severance portion of her contract, I will not be able to support this Separation Agreement,” Hall writes.

The News-Press revealed Hawes received a $22,500 perk and other compensation that was not stipulated in her 2009 contract.

A long-standing state law prohibits county employees from collecting severance pay that wasn’t agreed upon in their contract, according to senate analysis and attorney general opinions.

“No extra compensation shall be made to any officer, agent, employee, or contractor after the service has been rendered or the contract made…” according to the state statute.

Neither the $22,500 in deferred compensation nor the more than two months of compensation Hawes will receive after her last day of work (and on top of a year’s severance pay) were provided for in the 2009 employment contract she signed.

The law also forbids county officials from giving out severance pay or wages in lieu of terminating an employee, according to state attorney general opinions and senate bill analysis.

County officials added on the $22,500 payout after Commissioner Frank Mann threatened to have Hawes terminated if she didn’t resign.

Mann’s call for Hawes to resign or face termination was prompted by her handling of the county’s medical flight program, Medstar.

Hawes shut down the program after it had failed to meet federal safety standards for close to a year. County officials also violated federal rules by improperly charging for $3.3 million in medical flights — revelations that triggered an investigation by the Federal Aviation Administration.

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Those transgressions were concealed from the public, until The News-Press presented county officials with proof they occurred.

The statue further outlaws “lump-sum payments made as an incentive for an employee to end his or her employment,” according to a senate bill analysis of the law.

Hawes wants all of the money — that’s not paid while she’s on leave for more than two months — deposited in her account on January 16, 2013, according to the separation agreement she negotiated with the county.

In an effort to clamp down on pricey severance payouts, Gov. Rick Scott signed additional restrictions into law last year.

The new statutes prohibit county officials from receiving more than five months of severance pay, according to the law and bill analysis.

“What we passed was dealing with pretty luxurious compensation packages for severance,” Rep. Matt Caldwell, R-Lehigh Acres, said. “The point of this bill was to set maximum limits to the kind of compensation folks can receive when they’re terminated or in their severance packages.”

Hawes will collect more than 14 months of compensation after her last day of work — Oct. 31.

But the law only applies to contracts made after July 2011 and commissioners agreed to pay Hawes a full year’s severance in her 2009 contract.

Commissioners, however, agreed to let Hawes take nine weeks of vacation and sick time after her last day of work — adding more compensation than she would have received if the county just paid her for them, according to the separation agreement and officials.

Hawes will collect more than $37,000 while on “leave” for two months and another $23,000 in remaining vacation and sick days, according to payroll records and her separation agreement.

She will also receive a full year of tax deferred compensation that was never agreed to her in her original contract.

That compensation amounted to $22,500 this year, but the rate could increase when she receives the payout on January 16, 2013. It increased by $7,500 this year from the $15,000 she collected in 2011, according to officials and documents.

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Fraser, the deputy county attorney who worked on Hawes’ separation agreement and payout, did not return calls for comment.

In her email, Hall points out that she specifically questioned Fraser about whether Hawes’ separation agreement provided compensation beyond what the commission promised in her 2009 contract.

“When I asked you about this yesterday I felt that you instructed me that this agreement was consistent with the severance portion of her employment contract and that no other additions were being added,” Hall writes.

Hall also included a transcript of the meeting in her email:

Hall: “So this isn’t a request that she is making outside of the terms of her agreement that we signed when we engaged her in employment?”

Fraser: “No she is not.”

Commissioner Brian Bigelow said Fraser, who he has had constant run-ins with, should be the next official out the door.

“I do think that commissioner Hall is point on. Clearly the board has been misled by their attorney,” Bigelow said. “That alone I think is grounds for her termination. I’ve had it with her”

County Attorney Michael Hunt did not return calls for comment.

Commissioners Hall, Mann and John Manning did not return calls for comment.

Fraser did not tell commissioners how much money Hawes’ separation agreement would cost the county at Tuesday’s meeting and they didn’t ask.

Mann and Manning both said they didn’t know the amount before agreeing to pay it.

Hawes’ separation agreement was not made public before Tuesday’s meeting.

Bigelow said Fraser presented it to him just 10 minutes before he had to take the dais and vote on it. When he asked her for a dollar amount, he said, that she didn’t provide one.

The price tag could increase above $250,000 depending on how county officials interpret Hawes’ separation agreement.

It remains unknown whether Hawes will continue to accrue vacation and sick time, receive holiday pay and rake in a $500 a month auto allowance during the two months she’s on leave.

The agreement also fails to state whether Hawes will receive cash instead of the cost of a year of COBRA health insurance. It merely states she will receive the “equivalent” of the cost. Her husband also works for the county and the spouses of county employees are eligible for county healthcare insurance.

“I’m surprised and amazed that the BOCC was even asked to vote on something when they didn’t have a dollar amount,” Republican pick for commission District 3, Larry Kiker said.

“I can tell you that if I was in a meeting and that happened, I would say ‘we’re not ready to make a decision at this point in time’ and reschedule it, for a time certain, after everybody had a chance to review it,” he said.